Founded in 1998, La Chapelle is often called “China’s ZARA” as it focuses on fast fashion for young female consumers in China. Receiving regulatory approval for its IPO is welcoming news for La Chapelle, and its investors, as the company has previously tried and failed to list on domestic exchanges. Its Hong Kong-traded shares have long traded below its IPO price and are currently valued at a price-to-earning ratio of 3.5, compared to a projected PE ratio of around 29 for its planned A-share IPO.

With the more favorable valuation, La Chapelle can raise RMB1.64 billion (US$240 million) in fresh capital to fuel its expansion. Its venture investors will also be handsomely rewarded. Goldman, in particularly, will finally be able to make a positive return on investment after suffering significant paper losses.

Legend Capital invested RMB45 million to acquire a 25% stake in the company in 2009. A year later, as the company reached its earnings target, Legend invested another RMB46 million to remain its stake as required by a valuation adjustment mechanism embedded in the investment contract.

At the same time, Le Chapelle grew rapidly, quadrupling its sales to RMB2 billion in 2011 from RMB500 million in 2009. But its road to IPO did not go as well. In 2013, its IPO application was rejected by the China Securities Regulatory Commission as the domestic IPO market was suspended.

That year, Goldman invested RMB300 million for a 5% interest in the company, valuing the company at RMB6 billion, before the company moved its focus to a Hong Kong IPO. Other investors in the company from previous financing rounds include Orchid Asia Group Management Ltd., Boxin Capital, Shanghai Ronggao Venture Capital and Asia Alternatives Management LLC.

The company completed a Hong Kong IPO in October 2014, raising a total of HK$1.7 billion (US$220 million) by offering 121.58 million ordinary shares at HK$13.98. Its shares subsequently tanked and reached as low as HK$7 apiece last July despite a HK$120 million share buy-back aimed to improve sentiment. The poor performance also put Goldman at a significant paper loss.

In April 2015, shareholders approved a plan to list on the A-shares market during one of the biggest ever bull markets in the domestic Chinese stock market. Over two years later, the newly approved plan calls for the company to issue no more than 54.77 million new shares to raise RMB1.64 billion.

Le Chapelle plans to use the IPO proceeds on opening more retail stores. The company has expanded its network of retail locations, which are 100% self-owned, to nearly 9,000 last year from 1,841 in 2011.